USD/JPY has posted gains on Tuesday, as the pair has pushed above the 102 line and hit three-week highs. The dollar took advantage of disappointing Japanese consumer spending in June. On Tuesday, Japan will release Preliminary Industrial Production. Over in the US, today’s highlight is CB Consumer Confidence. The markets are expecting another strong showing from the June release.
Japanese data was dismal on Tuesday, as consumers continue to keep a tight grip on the purse strings. Household Spending declined by 3.0%, the third straight drop. The figure did beat the estimate of -3.7%. Retail Sales, the primary gauge of consumer spending, posted a decline of -0.6%, worse than the estimate of -0.4%. This was also a third straight decline. As well, Unemployment Rate rose to 3.7%, above the estimate of 3.5% and the highest level recorded since January. These figures point to trouble, as less consumer spending will likely translate into decreased economic growth and put more pressure on the Japanese currency.
We could see some strong movement in the currency markets on Wednesday, with three key events on the calendar. The Federal Reserve will release a policy statement and we’ll get a look at Advance GDP and the ADP Nonfarm Payrolls. If these releases surprise the markets, we could increased activity from USD/JPY.
USD/JPY for Tuesday, July 29, 2014
USD/JPY July 29 at 11:55 GMT
USD/JPY 102.04 H: 102.12 L: 101.82
- USD/JPY edged higher in the Asian session. The pair has continued to post gains in European trading and crossed above the 102 line.
- 102.53 continues to provide resistance.
- 101.19 is providing strong support.
- Current range: 101.19 to 102.53
Further levels in both directions:
- Below: 101.19, 100.00, 99.57 and 98.97
- Above: 102.53, 103.07, 104.17 and 105.70
OANDA’s Open Positions Ratio
USD/JPY ratio is pointing to gains in short positions in Tuesday trade. This is not consistent with the movement the pair, as the yen has lost ground. The ratio is made up of a large majority of long positions, indicating strong trader bias towards the dollar continuing to move to higher ground.
- 13:00 US S&P/CS Composite-20 HPI. Estimate 9.8%. Actual 9.3%.
- 14:00 US CB Consumer Confidence. Estimate 85.5 points.
- 23:50 Japanese Preliminary Industrial Production. Estimate -1.0%.
* Key releases are highlighted in bold
*All release times are GMT
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